Second, the Case-Shiller Index data set is limited to just 20 U.S. cities. There are more than 3,000 cities nationwide, which illustrates that the Case-Shiller sample set is limited.

And, lastly, the home sale price data used for the Case-Shiller Index is nearly two months behind its release date, rendering its conclusions somewhat out-of-date.

That said, the Case-Shiller Index joins the bevy of home value trackers pointing to home price growth over the last year. The Federal Housing Finance Agency (FHFA), for example, reported similar home price growth with its November 2012 House Price Index (HPI).

Home values rose 0.6 percent between October and November 2012 nationwide, the FHFA said, and climbed 5.6 percent during the 12 months ending November 2012.

Economists attribute increasing home prices to higher buyer demand, record-low mortgage rates and the gradual improvement of the U.S. economy.

For more information about the Atlanta area real estate market, please email me at ed@edshort.com or call me at 404.918.2500.

MEDIAN PRICE FOR ATLANTA HOMES

INVENTORY FOR ATLANTA HOMES

AVERAGE DAYS ON MARKET FOR ATLANTA HOMES

MARKET STRENGTH FOR ATLANTA REAL ESTATE

The chart above, Market Action Index (MAI), illustrates the balance between supply and demand using a statistical function of the current rate of home sales versus current home inventory on a scale of 1-60. An MAI value greater than 30 typically indicates a “Seller’s Market” (a.k.a. “Hot Market”) because demand is high enough to quickly absorb available supply. A hot market will typically cause prices to rise. MAI values below 30 indicate a “Buyer’s Market” (a.k.a. “Cold Market”) where the inventory of already-listed homes is sufficient to last several months at the current rate of sales. A cold market below 27 will typically cause prices to fall.